Spotify hit the public market Tuesday with force, bypassing traditional routes (see 1804020050) to an initial public offering, and was poised to become the third-largest U.S.-listed tech IPO on record with an opening value of $29.55 billion, said The Wall Street Journal Tuesday. Shares opened at $165.90 and were up 15 percent from their $132 reference price by mid-afternoon before closing 13 percent higher at $149.01.

Facebook lacks transparency, and should consider an independent body to filter acceptable online speech that reflects social norms and values, Facebook CEO Mark Zuckerberg told Vox, which an analyst called a positive development a day later. “I don’t think we are transparent enough around the prevalence of different issues on the platform,” he reportedly said. Zuckerberg said the platform is researching how to improve the quality of time users spend on the social media site. It’s wrong to assume Facebook is a bad use of time, he said, but maximizing the day-to-day length of user engagement shouldn’t be the goal, either. In the past year, Facebook has researched “what drives well-being for people and what uses of social networks are correlated with happiness and long-term measures of health and all the measures of well-being that you’d expect and what areas are not as positive,” Zuckerberg said. Positives "from a Beltway perspective" included the CEO acknowledging "need for transparency in how Facebook's editors and algorithms make content decisions" and being open to oversight, though the arbiter Zuckerberg suggested is unlikely to come to fruition, wrote Cowen's Paul Gallant Tuesday.

A lower court made a "remarkable conclusion" that the NFL, TV networks and DirecTV are immune from antitrust scrutiny even if an agreement among the three limits competition substantially increases prices and decreases access to pro football telecasts -- "the very definition of anticompetitive conduct," said a group of appellant sports bars and DirecTV subscribers in a 9th U.S. Circuit Court of Appeals docket 17-56119 opening brief Thursday (in Pacer). Appellants said the court's approach -- analyzing separately agreements between the league and DirecTV and agreements between the teams and the NFL on TV rights -- led it to conclude the plaintiffs challenge only the DirecTV agreement and not the teams' horizontal agreement and to misunderstand how these interconnected agreements operate. A U.S. district judge in Los Angeles last year threw out consolidated complaints suing the MVPD and NFL over DirecTV's "Sunday Ticket" programming (see 1707030002). DirecTV parent AT&T didn't comment Monday.

Spotify’s direct listing on the New York Stock Exchange Tuesday (see 1803150053) could pave the way for other pre-IPO companies to choose a similar alternate route to going public, but the deal carries a “high degree of uncertainty” since 91 percent of the 178 million shares will be set by broker-dealers based on buy and sell orders, said Renaissance Capital IPO Research in a Friday investor note. Spotify has 71 million Premium subscribers, who generated 89 percent of Q4 revenue, said the analyst, noting that’s twice as many paying users as its nearest competitor, Apple Music. Spotify’s 90 million ad-supported monthly active users provide “a long runway for growth,” said Renaissance. Though Spotify has yet to make a profit, “it has achieved positive free cash flow, and has offset declining ARPU [average revenue per user] by decreasing churn and improving gross margin,” it said.

Voluntary memoranda of understanding (MOU) in media mergers lack teeth and need more federal oversight, blogged George Mason University sociology Ph.D. candidate Jason Smith and New York lawyer Randy Abreu Friday for the London School of Economics and Political Science U.S. Centre. They cited a 2010 MOU between Comcast and Hispanic interest groups signed as part of that company's bid to buy NBCUniversal. But despite that MOU, they said, a Columbia University Center for the Study of Ethnicity and Race study indicates it has not increased Hispanic representation off screen, that stereotyped portrayals increased on screen, and that Hispanic leaders in the company "were segregated and paid less." They said the FCC, by not adapting the language or intent of the MOU into formal conditions, "fundamentally set up a scenario in which Comcast had no obligation to support diversifying the media landscape." The agency and Comcast didn't comment.

Uber spokesman Matthew Wing emailed us Thursday that his company is declining comment on reports it reached a settlement with the family of Elaine Herzberg, 49, the pedestrian struck and killed March 18 by an Uber SUV in autonomous mode as she walked a bicycle across a street in Tempe, Arizona (see 1803190024).

The ratio of pay-TV customers who also subscribe to an online video service grew to 21 percent in late 2017, from 10 percent the year before, said a Wednesday Parks Associates report. Parks cited the increasing number of partnerships between pay-TV and over-the-top providers, with operators such as Comcast adding support for Netflix on their set-top boxes. The number of cord-never households continues to increase “but those who have sampled pay TV are testing new alternatives," said analyst Brett Sappington. The percentage of viewers open to canceling pay TV or minimizing their monthly spend also is rising, leaving operators to reassess their technology and content investments and partnerships, he said. Parks scheduled a workshop on survival in the video world at the Pay TV Show in Denver May 14.

Google's YouTube doesn't seem to be engaged in a public function that was traditionally exclusively reserved for the state, such as a private corporation that operates a town's municipal functions or has been given control over a previously public right of way, said U.S. District Judge Lucy Koh in San Jose Tuesday, granting Google's motion to dismiss Prager University's complaint and its request for a preliminary injunction. The docket 17-cv-6064 order (in Pacer) said Prager's complaint about YouTube's restricted mode feature (see 1801030009) relied heavily on the Supreme Court's Marsh v. Alabama decision, but Marsh "plainly did not go so far" as saying any private property owner operating its property as a public speech forum becomes a state actor that has to comply with the First Amendment. The court also rejected the conservative group plaintiff's argument that limiting some Prager videos via its restricted mode is false advertising by implying they have inappropriate content, saying YouTube didn't say anything publicly about the classification of those videos. Prager counsel didn't comment. Others have argued for years along the same lines as Prager as they sought legal grounds for letting online participants override YouTube's editorial discretion, but that argument "remains devoid of merit," blogged Santa Clara University Director-High Tech Law Institute Eric Goldman. He said the District Court ruling also rejects the "currently-chic argument" that the Supreme Court's Packingham v. North Carolina decision restricts social media services' editorial discretion, with Koh correctly reading Packingham as putting limits on state restrictions on access to social media rather than on the social media providers' discretion. He said similar "conservative-voices-hardship cases" making the same arguments, such as cases against Twitter, likely will "meet a similarly hostile reception. ... Perhaps these cases collectively form a solid wall of precedent that will discourage further plaintiffs from seeking to strip Internet services of their editorial discretion."

Spotify, scheduled to make an initial public offering April 3, released its financial outlook for Q1 and the full year on Monday. Total monthly active users for Q1 are projected at 168-171 million, up 28-31 percent year on year, with premium subscribers totaling 73-76 million, a 41-46 percent year-on-year increase, it said. Revenue for Q1 is forecast to be 1.10 billion euros-1.15 billion euros ($1.37 billion-$1.43 billion), up 22-27 percent over Q1 2016. For full year 2018, Spotify is projecting 198-208 million subscribers of whom 92-96 million are premium. Full-year projected revenue is 4.9 billion euros-5.3 billion euros ($6.1 billion-$6.6 billion), it said. At Spotify’s first investor day this month (see 1803150053) CEO Daniel Ek shunned “pomp or circumstance” of a conventional IPO road show, saying the traditional model wasn’t “a good fit.” Noting the typical IPO requires a quiet period, he said: “We don’t think that’s the right thing to do.” Spotify has allowed employees and shareholders to buy and sell stock for years “and that shouldn’t stop just because our stock is becoming more widely owned,” he said. The company isn’t selling any stock when shares begin trading April 3: “We’re entirely focused on the long-term performance of the business,” said Ek. As of March 21, Spotify had 178.1 million shares outstanding, said an amendment to an SEC-1 filing.

Four members of the British Parliament urged the U.K. Competition and Markets Authority (CMA) to block Fox's bid for Sky. In a letter Thursday, the four said that Comcast also is bidding for Sky (see 1802270011) undercuts the threat Sky raised that without a Fox deal, it might have to close Sky News (see 1711080003). They said it would be very difficult to craft effective behavioral conditions to ensure Fox doesn't influence Sky News and to create a means for monitoring such conditions. Signing the letter were Ed Miliband, Vince Cable, Kenneth Clarke and Charles Falconer. The CMA in January issued a preliminary finding that a Fox buy of Sky may not be in the public interest regarding media plurality (see 1801230010). Fox didn't comment Friday.